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The Louisville Regional Airport Authority on Wednesday approved a $96.6 million operating budget for fiscal 2009.

The budget, which goes into effect July 1, presumes that 1.9 million people will board planes at Louisville International Airport next year. That figure would be down from the anticipated 2 million expected in the current fiscal year, which ends June 30, airport authority executive director Skip Miller told the authority's board.

The budget provides for continuation of one noise-abatement program — the Minor Lane Heights relocation program, which began in 1988 — and the start of another one, the soundproofing of between 350 and 1,100 homes to the north of the airport that are affected by air traffic noise.

Taking a conservative approach

In his budget address to the board, Miller said the airport authority needs to continue to be conservative in its spending as airlines face unprecedented fuel costs and capacity contractions.

Miller said the International Air Transport Association, which in March predicted the industry would turn a combined profit of $4.5 billion in 2008, said this month that it expects the industry to suffer a combined loss of $2.3 billion for the year.

In the meantime, Miller said, the budget allows for an increase in marketing and air service development dollars to more aggressively recruit new air service and passengers.

"This is not the time to retrench," Miller told the board.

He added that Louisville International continues to fare well against regional competitors such as Lexington, Cincinnati, Nashville and Evansville, all of which experienced year-to-date decreases in passenger growth through April.

Louisville International's passenger growth was up 6.3 percent during the same period, Miller said.

Other highlights of the fiscal 2009 budget are:

• Funding capital projects at Louisville International and Bowman Field without incurring additional debt;
• Continued construction of Taxiway A and the relocation of the FedEx apron at Louisville International;
• Completion of an emergency operations center at Louisville International;
• Continuation of airport vehicle fleet modernization and purchase of new fire-fighting equipment for Louisville International;
• Repair of T-hangar roofs at Bowman Field.

About 64 percent of the budget will come from operating revenue generated at Louisville International. Another 26 percent will come from Federal Aviation Administration grants faxless payday advance pay day advance. Charges to passengers assessed on airline tickets will account for 5.8 percent, and 2.5 percent will come from interest income. The remaining 1.6 percent will come from the operation of Bowman Field.

The largest chunk of expenses — 35.3 percent — will come from debt service. Capital improvements and major maintenance at Louisville International will account for 32.3 percent of expenditures, and 25.9 percent will come from the operation of Louisville International.

The authority plans to put 2.8 percent of the $96.9 million budget into reserves. It will spend 2.1 percent on capital improvements and major maintenance at Bowman Field, and 1.7 percent will be spent to operate that airport.

Board meeting becomes contentious

An increase in the rent charged for hangars at Bowman Field, approved as a part of the 2009 budget, caused turbulence before the meeting ever got off the ground.

The budget included an approximately $40 per month increase in Bowman Field hangar rents, an increase that board members contend is necessary to fund replacement of the aging hangars at the general aviation airport.

The increase will raise rates to $300 from $260 per month for a standard hangar. Rates for oversized hangars will range from $382 to $555 per month.

The rate increase takes effect Feb. 1. It drew the ire of about 25 Bowman tenants who packed the authority's board room, hoping for a chance to voice their opinion.

Prior to the meeting, when board member Norm Risen learned that Bowman tenant representatives had only five minutes to plead their case to the board, he gave a passionate speech about his objection to the rate increase.

Risen told the board that the 24 percent increase in hangar rates was "criminal," considering the state of the hangars in question.

He also took Louisville Metro Mayor Jerry Abramson to task for not attending the board meeting, as he said Abramson had told him he would.

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